Frequently Asked Questions

About Financial Engines

Financial Engines is an independent and objective investment advisor. The company was founded in 1996 by Dr. William F. Sharpe, who won the 1990 Nobel Prize in Economics Sciences, to provide retirement investment advice to American workers.

Many participants do not have the time, energy, or expertise to make informed retirement investing decisions. Financial Engines helps people save and invest, so that they might enjoy the retirement that they’ve always dreamed about. Financial Engines has a passion for delivering personalized, independent retirement help for everyone, regardless of their wealth.

No. Your plan or its representatives select a diverse mix of funds to include in the plan lineup, but it is your responsibility to make investment choices for your account. Financial Engines can help you feel more confident about making those choices.

To help you take better advantage of your retirement plan benefits. Through Financial Engines, you have access to the kind of professional help that was previously available only to the wealthiest investors.

We work closely with leading 401(k) providers, but our focus is different. While they manage the overall fund lineup in your company’s 401(k), we give you a personalized plan for how to make the most of the choices you have. The plan we create is tailored to you and your situation, and your successful retirement is our number one goal.

Financial Engines is independent, unbiased and we don’t sell investment products or earn commissions. So you can be confident we have your best interests in mind.

Objectivity is key. We recommend investments without bias. We don’t sell investments or receive payments based on the funds we recommend.

A diversified portfolio can help manage risk. Spreading risk over different types of investments can help protect you from the ups and downs of market and economic cycles.

Expenses and taxes matter.Expense ratios, taxes, and asset turnover can impact performance and erode a fund’s returns. Our methods take these factors into account, and have more power to forecast future returns than just historical fund performance.

Realistic forecasts are essential to planning. No one can tell exactly how much your portfolio will be worth when it is needed most. But when you know about the range of possible risks and returns, you’re in a better position to prepare for the future.

Retirement investing is a long-term commitment. We focus on your long-term financial future. We work to keep your portfolio appropriately allocated and diversified, even in difficult market conditions. We can’t prevent market losses, but we can help you to avoid exposure to the worst possible damage. A disciplined, long-term, and diversified strategy is still the best way to accumulate wealth.

About Online Advice

The Online Advice service is designed for participants who are confident in making investment decisions on their own and monitoring their accounts over time. With Online Advice, you can explore scenarios and fine-tune an investment strategy. You can model different contribution rates, risk preferences, and retirement ages, and you can also enter other retirement accounts for consideration in your overall advice strategy. Online Advice provides specific recommendations, personalized to your goals. It is up to you to execute the recommendations.

About Professional Management

The Professional Management program is a fee-based, discretionary, personalized asset management program being made available to eligible plan participants. Included in the service are the following features:

Customized portfolios.

Ability to personalize for risk, retirement age, and outside accounts.

Ongoing management and regular monitoring of managed account(s).*

Quarterly Retirement Updates.

Access to Investment Advisor Representatives.

Comparison: Professional Management vs. Online Advice

The difference is in how much help you’d like with your Retirement Plan. If you’re already managing your account through the company’s benefits Web site, Online Advice is a self-service way to get objective advice. You have to implement its personalized recommendations on your own and remember to check back regularly for updates. But if that doesn’t sound like you, or if you’re not sure you’re making good decisions, you may be interested in having an expert look after your account. Professional Management is a full-service way to get ongoing, independent investment management for your account.* Professional Management also includes Financial Engines® Income+ to help transition your 401(k) savings to retirement income.

*Financial Engines Advisors L.L.C. is an independent investment advisor that does not receive commissions; we provide advisory services on an advised and sub-advised basis.

With Online Advice, it’s up to you to decide whether to take our recommendations. With Professional Management, we automatically request the transactions to put your new strategy into action and to help keep you on track over time. But you can take a more active role if you want, by personalizing your management strategy. For example, you can adjust your risk preference, change your desired retirement age, or have us consider other investments. When you have questions, Investment Advisor Representatives are just a phone call away.

There’s no such thing as a one-size-fits-all investment strategy. That’s why Financial Engines gives you a personalized Retirement Plan designed to fit your situation. We analyze expense ratios, sales loads, asset turnovers, transaction costs, and management styles. To manage risk, we emphasize diversification—a technique that spreads risk over different investment types. We balance all these factors to create a personal investment strategy designed to maximize expected returns at a risk level appropriate for you.

Many companies offer stock as an investment option in their plans. A large concentration in your company’s stock can increase investment risk no matter what company you work for. We look at your company stock’s characteristics, and your risk tolerance, when making our recommendation. We can help you monitor your stock holdings to avoid taking on inappropriate risk.

Even if you’re not planning to retire for some time, you should review your Retirement Plan on a regular basis to make sure you’re still on track. As you approach retirement, it’s even more important to keep a close eye on how you are progressing toward your financial goals. With Professional Management, an investing expert looks after your account, making periodic adjustments as needed. With Online Advice you have the option of signing up for regular e-mail Retirement Updates, with links to get updated advice.

This site contains certain online articles, videos and other information provided by carefully selected third party providers. All information provided through this site is for education purposes only and does not constitute investment, legal or tax advice, an offer to buy or sell any security or insurance product or an endorsement of any third party or such third party’s views. You, not Financial Engines, are solely responsible for your financial decisions. Results are not guaranteed. Whenever there are hyperlinks to third-party content, this information is intended to provide additional perspective and should not be construed as an endorsement of any services, products, guidance, individuals, or points of view outside Financial Engines. Service features and content are subject to change without notice. This site is for U.S. residents only. Your use of this site is subject to the Financial Engines’ terms of service and privacy policy. For more information, see http://www.financialengines.com.